EUR/USD aims for intraday high inside immediate trading range.
Market sentiment dwindles on light calendar, off in Japan.
US President Biden hopes infrastructure spending passage even as Senators rejected opening debate, covid woes escalate.
No change in ECB monetary policy is expected but statement, President Lagarde’s press conference will be the key.

EUR/USD aptly portrays the pre-ECB trading lull, marking a 15-pip trading range around 1.1800, heading into Wednesday’s European session. That said, the major currency pair recently picks up bids to the range’s resistance amid the US dollar pullback.

In addition to the market’s cautious sentiment ahead of the European Central Bank (ECB) monetary policy meeting, off in Japan and a light calendar in Asia also contributes to the sluggish momentum. Even so, the quote keeps the previous day’s bounce off early-April lows.

It should, however, be noted that the coronavirus woes and lack of clarity over US President Joe Biden’s infrastructure spending plan, as well as the US budget, keep the pair sellers hopeful. On the contrary, mildly bid stock futures, tracking Wall Street gains, favor the EUR/USD buyers.

Talking about the fears over the Delta covid variant, Australia registers the highest infections in 10 months whereas the UK reported a slightly higher daily count, 44,104 versus 42,302 the previous Wednesday, as well as a 50% weekly jump in the death toll to 73.

On the other hand, US President Joe Biden expects the infrastructure deal although the Senators voted against the opening debate the pushed back the negotiations to next week. Furthermore, US-China tussles escalate as US Trade Representative Katherine Tai backs Australia in its trade dispute with China. Also on the same line could be China National Security Law action in Hong Kong and five arrests.

It’s worth mentioning that the ECB is widely expected to keep its policy status-quo after showing readiness to accept a bit higher inflation than the 2.0% target during the last meeting. However, the Monetary Policy Statement and Press Conference of President Christine Lagarde will be the key as markets brace for a dovish considering the latest virus resurgence. If matched, the EUR/USD bears will jump back to the table and can cheer the death cross to aim for the yearly low.

Read: ECB Preview: Three reasons why Lagarde could hit the euro when it is down

EUR/USD teases a death cross on the daily chart, a pattern wherein the 50-DMA drops below the 200-DMA and signals further downside. However, an ascending support line from November, around 1.1775 becomes a trigger for fresh fall.

Read: EUR/USD Price Analysis: Impending death cross teases bears around 1.1800 on ECB day

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